Tuesday, December 31, 2019
Jordan on December 19 signed up to the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (the Convention).
Jordan became the 93rd jurisdiction to join the Convention, which now covers over 1,650 bilateral tax treaties.
The Convention became effective on January 1, 2019, and now applies to 133 tax treaties concluded among the 38 jurisdictions that have already deposited their instrument of acceptance, approval, or ratification.
The Convention is the first multilateral treaty of its kind, allowing jurisdictions to integrate results from the OECD/G20 BEPS Project into their existing networks of bilateral tax treaties. Measures included in the Convention address treaty abuse, strategies to avoid the creation of a "permanent establishment", and hybrid mismatch arrangements. The Convention also enhances the dispute resolution mechanism, especially through the addition of an optional provision on mandatory binding arbitration, which has been taken up by 30 jurisdictions.